Proof BITCOIN FEVER was a scam? Report claims CRYPTO price was manipulated
Bitcoin saw its price multiply 13 times last year to hit $19,000 as a new generation of speculators jumped on the crypto bandwagon but a new report published by University of Texas claims to have found proof that bitcoin's price was manipulated during market downturns, using Tether, a cryptocurrency pegged to the US dollar.
The war of words between the traditional financial institutions and cryptocurrency enthusiasts could be nearing an end after professors John Griffin and Amin Shams of the University of Texas Department of Finance published a paper that provides the most compelling opinion yet of the alleged link between a controversial ‘stablecoin’ called Tether and the staggering price rises at the tail end of 2017.
During the period of global hype at the end of 2017, when bitcoin’s price rose from $963 on January 1st 2017 to $19,118 on December 19, global finance leaders around the world lined up to slam the technology as a scam or a ponzi scheme.
Bitcoin cynics include Jamie Dimon, CEO, JPMorgan Chase who said if people were “stupid enough” to buy bitcoin, they would pay the price, and legendary investor Warren Buffett, CEO of Berkshire Hathaway who likened cryptocurrencies to “rat poison.”
The damning report all but confirms concern within the crypto community over the hundreds of millions of dollars worth of new Tether that was created in 2018 during periods when the prices of other virtual currencies were heading south.
Tether is controversial because its price is “tethered” to the Dollar - $1 buys one Tether token.
However, this direct link between a cryptocurrency and the US dollar has caused concern and in January the Bitfinex exchange was subpoenaed by US regulatory agency - the Commodity Futures Trading Commission - over potential price manipulation.
"The issue is that Tether has failed to provide full account audits proving that they have the fiat reserves to back up their minted Tether. Tether is supposed to be pegged to USD one-to-one, and without proof, nobody knows if this is truly the case." - Greg Adams Managing Director of blokt.com
My Thoughts: When Bitcoin rose at the rate that it did, it was alarming, the currency had slowly grown, when out of the blue every media site was reporting this "new" financial future. Living in Africa the ideas I have read few have come to fruition.
When I started looked at exorbitant difference in prices between what some were paying in the USA compared to Zimbabwe, more alarm bells started ringing, these people are definitely buying on the well known term FOMO (Fear Of Missing Out)!
Collapse early this year left me annoyed somewhat, too many people shouting from the hilltops with little research or knowledge, driving more people into a deeper financial hell hole than they were already in. Now 6 months later possible truth is being revealed why Bitcoin 'went to the moon'.
Saddened by the neglectful way people drag good technology down, greed is astounding when frenzy takes over normal thinking. Where have all those who drove prices up gone, to jail I hope, alas that never happens, most shrug it off walk away with profits derived from misery, thinking nothing of it.
Heed warning signs, if it does not feel right, is too good to be true, rather avoid involvement.
Thought for Today: “I do think Bitcoin is the first encrypted money that has the potential to do something like change the world.” - Peter Thiel
